NB: This is a viewpoint by Eddie Robb, managing director for Make It Social.
The market is at a tipping point. Millennials are poised to become the dominant consumer segment globally, tipped to spend $200 million annually from 2017.
Businesses must begin to put themselves in the high top sneakers of Generation Y in order to stay relevant and responsive. Firms which are ignorant of this growth market, unwilling or unable to tweak traditional approaches in their business, may well be left at the starting gate.
So, are you ready?
A lot has been written about so-called Millennials. So much so that Generation Y, Generation We and Generation Me, to use the imposed vernacular, are likely to become the most studied cohorts of all time, although theory is not concrete as to who exactly constitutes genuine Gen Y status. Assertions range from births between 1982 and 2004 (Strauss and Howe) to between 1980-2000 (Goldman Sachs).
Broadly speaking though, we’re talking about today’s 16-35-years-olds who grew up in an era seismically defined by technology, globalisation and financial unrest.
Oddly – perhaps because I’m one myself – much of what is written in the business and marketing press on Millennials seems to have a curiously slippery grasp of this demographic, often representing it as mercurial, impulsive and hermetic.
There seems to be a cautiousness about how best to capture this unknown market, fortified with its own morals and ethics seemingly at odds with those of the corporations keen to court it.
In fact, Deloitte’s Millennial Survey 2015 revealed that 75% believed “businesses [are] focussed on their own agendas rather than helping to improve society” – a key concern for a globally- and socially-conscious youth market.
To understand how best to respond to Millennials in the travel sector, we’ve got to take a look at the formational socio-economic forces at play. On a macro level, the two main pressures on 16-to-35-year-olds have been the post-recession economy and the digital world.
These financial and social pressures have exerted an iconic influence, giving rise to the ‘extended youth phase’ or ‘emerging adulthood’ in youth theory.
Pew Research Centre has done much meaningful work in profiling this area, identifying that “millennials in adulthood” are “detached from institutions and network with friends”.
So far, so obvious.
So too is the fact that young people in this cohort entered higher education more readily and exited with more debt than prior generations.
The financial crisis of 2007/2008 gave rise to austerity, a shrinking and unstable jobs market and high youth unemployment. Many young people opted to live at home for longer and rely more heavily on the ‘bank of mum and dad’.
Marriage, buying a house and starting a family – the norms of previous Generation X and Baby Boomers – were put off as a result. And of course it is Generation X and the Baby Boomers who are running the businesses trying to grasp the Gen Y baton.
It seems as if the chasm between Generation X and Y is ever-widening. Young people surrounded by technology turn to online social communities and global networks for their sense of belonging.
As we’re the first generation to grow up digitally native, change management has been hot on the lips of forward-looking businesses and marketers desperate to understand and capture a slice of this 17 million strong pie in the UK alone.
So how should this macro context inform the travel industry? Well, we’ve got to start considering how it influences the way consumers book their travel experiences, because it is changing.
As things stand, the theory and practice of the online booking flow has changed very little, if at all, in the twenty years or so that the internet has been around.
For sure, businesses such as HotelTonight have captured the mobile-led spontaneity required by Millennials to create a new paradigm, but examples like this are few and far between.
The online booking flow remains predominantly one-person centric, especially in the standard group booking model.
To digital natives this is anachronistic – it offers no visible insight into what your friends are up to; forces a ‘group leader’ to collect monies and pay for everyone else upfront or try to chase payment from friends later; it creates frustration for the group leader who has to provide the entire group’s booking information over the telephone or via a couple of isolating booking web pages.
In short, it’s a hassle, it’s boring and it’s unintuitive – of course, these groups could co-ordinate their schedules, meet up at a high street travel agent and spend an afternoon doing it manually via a ‘consultant’.
But find me a millennial who’s done this and I’ll eat my baseball cap.
The industry needs to rethink the booking flow and here’s a few pointers in the right direction.
Be part of the social conversation, but don’t try to control it
With the prevalence of social media and mobile devices, access to ‘the group’ and friends online needs to be omnipresent.
Steve Weiner, co-founder of Wharton FinTech and a Millennial himself, recently told business delegates: “We [millennials] don’t want to have a one-to-one relationship with you…we look at building trust based on what our peers tell us via social media”